Now President Trump is seeking to rewrite NAFTA - and if it can't be revamped to his satisfaction, then scuttle it altogether. It was later amended during the original NAFTA negotiations. Wyden in a statement Tuesday said "you can't fix NAFTA without fixing issues with Canada" while also asserting that Congress has "authority over trade - the president cannot pull America out of NAFTA without Congress's permission". "We continue to get a deeper and deeper understanding of the concerns on both sides".

Trudeau has deemed the cultural exemptions a red line and something that must be included in any new agreement.

"If we don't make a fair deal for the USA after decades of abuse, Canada will be out, " he wrote.

If they don't reach an agreement by the end of the week, President Trump has threatened to cut Canada out of the deal and forge ahead with a new pact with Mexico alone.

Congress must approve any rewrite of the deal and could refuse to endorse an agreement that excludes Canada. But the administration has revealed some key revisions concerning North America's highly integrated automobile manufacturing sector that USA officials say would result in a shift of some lost manufacturing jobs back to the US.

The Mexican deal guarantees workers the right to union representation, and insists that 40-45% of cars are made by workers who are being paid at least $16 per hour. The U.S. wants it out of the deal, but Canada says it must be included.

Holt wrote in a Tuesday note that Congress will not allow Trump "to skirt past Canada in NAFTA negotiations given the long line-ups of members of Congress - Democrats and Republicans - saying they will not support a bilateral deal" with Mexico.

But some experts say it is not so much the terms of the tentative deal with Mexico as it is the transactional and divide-and-conquer tone of the U.S. approach that endangers a "spirit of community" from which the USA has reaped considerable benefit.

Trump is embarking on a high-stakes gamble, cutting a deal with Mexico first, in hopes of forcing Canada to acquiesce.

Talks with Canada aimed at bringing the top United States trading partner into the tentative deal struck with Mexico broke off Friday without success, but the parties agreed to continue talks this week.

U.S. President Donald Trump has threatened to push ahead with a bilateral deal with Mexico, effectively killing the nearly 25-year-old three-country pact, which covers $1.2 trillion in trade. "In the case of Mexico, having the certainty of a deal is important because essentially we need the foreign investment and the national investment", said Luis Foncerrada Pascal, director of the Centre for the Study of Private Sector Economics, a think tank in the capital.

"We've said from the very beginning that we need a dispute resolution mechanism like Chapter 19 and we will hold firm on that", Trudeau told reporters in Vancouver.

"It's time to modernize" NAFTA, Ms. Hills said last week on MSNBC. "We want friends, we live in a world that is highly competitive. Analysts say that could be very bad for the USA auto industry, which makes cars and sources parts across all three countries".

"Obviously, they are not going to pre-commit to it", said Andrew Kelvin, senior rates strategist at TD Securities. A lot is riding on a new NAFTA deal.

"We are making good progress". "When the NAFTA partnership seems less than permanent, it undermines part of the goal of the deal - which after all was to encourage and secure Mexico's integration into the broader global economy".

"Both neighbors are looking elsewhere, they went ahead with the TPP [Trans-Pacific Partnership] minus the USA", he says. Canada wants to ensure its publishing and broadcasting industries are not overrun by bigger United States rivals, and that dairy imports don't pull down prices for its own farmers.

Trade deficit in Canada continues to shrink.

Which of these should Canada compromise on to save NAFTA?

Foreign Affairs Minister Chrystia Freeland went out of her way to praise her counterpart, USA trade czar Robert Lighthizer, saying he was acting with "good faith" and "good will".

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